The province plans to introduce legislation to introduce the B.C. home-flipping tax this spring. If passed, it will take effect on January 1, 2025.
Any home sold within two years of purchase will be taxed at that time, with the revenue funding new homes. Exemptions to the home-flipping tax will be available to people who face unavoidable life changes, including death and divorce, job relocation or loss, and people who are adding to B.C.’s housing supply.
“We know that people are struggling to find homes to rent or buy in areas close to work and their families,” said Katrine Conroy, Minister of Finance. “We want people to know our government has your back. That’s why Budget 2024 takes further steps to deliver more housing for people faster and ensure homes are lived in.”
The flipping tax complements other measures the Province says it has taken to discourage housing speculation, including a speculation and vacancy tax, estimated to have freed up at least 20,000 homes in Metro Vancouver.
“For many people, housing is their number 1 concern,” said Ravi Kahlon, Minister of Housing. “We are delivering results, but we’re not done. B.C. Builds is going to deliver thousands of middle-class homes in communities people want to live in.”
Home-flipping tax: what to know
The home-flipping tax will apply to homes sold within two years.
Homes sold within the first year will face a tax rate of 20% of the profit, declining to zero over the next 365 days.
Between 2020 and 2022, approximately 7% of residential house sales were resold within two years.
Starting April 1, 2024, people may be eligible for the First Time Home Buyers’ Program for homes valued up to $835,000, paying no property transfer tax on the first $500,000.
Partial exemptions are available on homes valued up to $860,000, which could result in savings of up to $8,000.
Also, starting April 1, 2024, a Newly Built Home Exemption means property transfer tax will be waived on new homes worth up to $1.1 million, an increase from the previous $750,000 price limit, to encourage new home building.
Rental home construction is being encouraged through an enhancement to the exemption for purpose-built rentals.
Between Jan. 1, 2025, and Dec. 31, 2030, purchases of qualifying rentals will be exempt from the general property transfer tax.
Ihor Zalubniak says
If you bought a home in the last year or so with the intent of reno or resale, you have til January 2025 to complete your selling transaction to avoid any “flipping” tax. Pre-sales included. Has your Realtor brought this to your attention?